Turkey will offer US dollar-denominated bonds for the first time since its elections in May, further indicating the Turkish government’s commitment to conventional fiscal policies since President Recep Tayyip Erdogan’s won that vote.
The Turkish government will offer a five-year dollar sukuk (an Islamic, bond-like debt instrument that complies with shariah law’s prohibition on interest) and is discussing an initial yield of approximately 8.875%. The offer will be worth at least $500 million, an unidentified source told Bloomberg.
The Turkish government did not immediately comment on the Bloomberg report.
Why it matters: Reuters predicted in September that Turkey could return to the international bond market before the end of the year as part of the country’s return to economic orthodoxy and efforts to lure back foreign investors.